Tax regime definition - What it is, Meaning and Concept

Of the Latin regime , regime is the political and social system that governs a certain region and the set of rules that regulates a thing or an activity.The concept also refers to the historical formation of an era (political regime).

Prosecutor, meanwhile, is the belonging or relative to the treasury This last term is linked to the public treasury or public bodies that are dedicated to the collection of taxes and taxes.

The tax regime is the set of rules and institutions that govern the tax situation of a person physical or legal.It is, therefore, the set of rights and obligations arising from the development of a certain economic activity.

The tax regime acts as a guide at the time of liquidation and payment of taxes.At the time of developing an economic activity, people must register in some category to meet the obligations of the Treasury.Generally, there are usually several options, that is, various tax regimes to which can be submitted according to the characteristics of your business.

The tax legislation of each country determines the conditions of the tax regimes.The amount of money to be disbursed, the maturities, the declarations and everything related to the taxes they depend on the regulations in force in the different territories that, in addition, may change over time.

It is possible to change the tax regime if the economic activity develops differently than expected and the obligations of the framework no longer fit reality.

Tax regimes of natural persons

In the first place it is necessary to define the concept of a physical person: it is any individual who has the capacity to assume obligations and make use of their rights.In this specific context, among its characteristics is the possibility of carrying out activities that are within the framework of the law.

For tax purposes, physical persons are grouped into: those who provide services; those that carry out commercial activities; those that work for an employer and charge a salary.

Saving the characteristics of each country, taxpayers have the obligation to contribute money for public spending through the payment of taxes and this arises, in turn, from the activities they carry out.Among the many possibilities is the provision of services, leasing of real estate, work under dependency and commercial activities.

A commercial activity implies the purchase and sale of items in exchange for a profit or gain for those who makes; On the other hand, providing a service consists of working on their own, without relying on an employer.The third possibility, the work for a salary, is the provision of a service but in an organization whose hierarchy has roles above the employee.

There are certain special cases, which cannot be included in the aforementioned activities, and which also belong to a specific tax regime:

* the additional remuneration (called emoluments ) received by the board of directors; * the income of diplomats from foreign embassies and international organizations; * the income received by the armed forces, federal entities and municipalities; * advances received by members of associations and civil societies.

Contributing to public spending is not only an obligation, but it represents a very important benefit for the economy of a country, as it is one of its main sources of income.The fiscal regimes to which a physical person can belong There are several and depend directly on the type of activity they carry out, as well as the average income.